Estimating—it can be a jungle out there. Bid too low and you may win the project and lose your shirt. Bid too high and you could be left wondering how you arrived at such bad numbers in the first place.
If you’ve ever worried about bid accuracy, you’re not alone. Construction industry insider George Hedley estimates 80 percent of construction owners don’t know the true cost of doing business. Even if your construction firm has a nine-month backlog, you can still miss details in project scope or fail to meet all the requirements in your final bid.
Don’t Forget the Pickup Truck
It’s easy to fall victim to the pitfalls of estimating. You can count quantities correctly all day long, but you may still end up on the wrong end of a low bid if you’ve failed to double-check your numbers.
In our new Estimating Infographic, Maneuver Past 5 Common Estimating Hazards, we explore how to make sure you’ve calculated for everything—including the long-ago, paid-for company pick-up truck that runs to every job—week in and week out.
For example, if you’re only including the gas, plus a little extra, you may be making a big mistake in your estimate. Where is the accumulation of those dollars to replace the vehicle included in your estimate? Are you accounting for the maintenance, registration, or other costs?
Even worse, some estimators just use a number like $85 per hour without a solid understanding of how they arrived at the number. It’s important for cost estimators to know whether this is just a generic overhead number. Regardless, it may be time for the estimator to sit down with accounting to make sure they are correct in their number and assumption.
Turn Super-Busy into Super-Profitable
Sure, some cost estimators will get lucky with a project because they built fluff into their bid or their crews will work faster than what has been estimated. However, with pressure mounting to accelerate the bid process and win more construction projects, many estimators are risking accuracy and introducing errors based on assumptions or old numbers.
When the bid is on the line, no one wants to discover they’ve been miscalculating equipment costs for six months or forgetting to accurately include site excavation work. In our new Estimating Infographic—Maneuver Past 5 Common Estimating Hazards—you can find out how to overcome your toughest estimating challenges to win more profitable projects for your construction business. Check it out now to ensure every bid awarded is accurate, not overcharged, or low-balled.